Friday, 4 March 2011

Cambodia says firms lining up to list on new bourse

via CAAI

By Prak Chan Thul

PHNOM PENH, March 3 | Thu Mar 3, 2011

PHNOM PENH, March 3 (Reuters) - At least 10 private sector companies want to list on Cambodia's long-awaited bourse, which is due to open this year, the government said on Thursday, as debate continued over which currency the market should use.

"There are two state-owned companies and more than 10 private companies," Hang Chuon Naron, a secretary of state at the Finance Ministry, told journalists at a currency conference in Phnom Penh when discussing interest in the bourse.

He declined to give further details.

Earlier this week, Finance Minister Keat Chhon urged more private companies to seek a listing so they could raise funds to expand.

"The government has also considered tax incentives for companies that issue public shares and this work is in final technical discussion," Keat Chhon said on Monday after approving licences for firms that will work on the Cambodia Stock Exchange (CSX), such as settlement agents.

Keat Chhon said the government had signed contracts with two securities firms to help three state-owned companies, the Phnom Penh Water Supply Authority, Telecom Cambodia and Sihanoukville Autonomous Port, prepare listings.

The much-delayed market is now scheduled to open in July.

One big question is over what currency to use for listings, and a decision on that is expected within a week, said Huot Pum, a deputy director-general of the bourse regulator, the Securities and Exchange Commission of Cambodia (SECC).

Foreign investors want to see shares quoted in U.S. dollars, which is widely used for transactions in Cambodia and accounts for 90 percent of deposits and credits in its banking system, and say risk will be harder to gauge if the local currency, the riel, is used.

Hang Chuon Naron did not suggest what the decision would be, but he said a change in the reality of a 90 percent dollarised economy was unrealistic in the short term.

"This is a fact. If we make changes, we should do it gradually in accordance with reality. If we force the use of the riel or another currency, it will not reflect reality," he said. (Editing by Alan Raybould)